Data and analytics company GlobalData forecasts that the demand for lithium needed for the production of lithium-ion batteries for use in EVs will more than double from 26.7kt in 2018 to 58.3kt in 2022.

According to GlobalData, the global EV market is expected to grow at a substantial CAGR of 15.6% through to 2022, driven by the growing popularity of EVs across countries in Asia-Pacific (APAC) and Europe.

The company projects that China will lead the global EV market with more than 50% share and grow three times as fast as the US over the next five years.

This in turn will result in increased consumption of lithium and support investment in mine expansions across Chile and Australia and new mine development in Chile, Australia, Argentina and Canada.

Several national governments are encouraging the adaption of EVs by providing various tax incentives and subsidies to the manufacturers and end users. Additionally, efforts to reduce greenhouse gas emissions have led to much technological advancement in EVs and made them a viable and safe alternative to traditional vehicles.

—Vinneth Bajaj, Senior Mining Analyst at GlobalData

In 2017, 1.1 million new EVs were sold globally, of which China accounted for more than 50%, followed by the US with 17.3%. In Europe, Norway accounted for 5.4% of global sales, followed by Germany (4.8%) and the UK (4.1%).

Over the next five years, global EV sales are expected to increase to over three million vehicles, primarily driven by APAC and Europe. Meanwhile, EV sales in the US, Norway, Germany and Japan are expected to grow at CAGRs of 9.2%, 7%, 8.2% and 8.2% to reach 380,000, 107,000, 100,000, and 99,000 vehicles, respectively, in 2022. These numbers include battery electric vehicles (BEV) and plug-in hybrid electric vehicles (PHEV).

The largest increase will be in China, which is expected to boost its EV sales from 579,000 in 2017 to 1.5 million by 2022. Current government policies and subsidies are making China a lucrative market for industry investments due to which the country’s EV market is poised to grow three times as fast as the US during the outlook period.